Monthly Archives: February 2014

Do You Believe in Magic?

coldIt is bitter cold in New York this morning, 2 degrees, plus the wind chill.  Across the border into Canada, it’s minus 14 – a little warmer.  How is it possible that minus 14 is warmer than 2 degrees?  Obviously, the Canadians use a different thermometer.

You cannot make yourself warmer by switching thermometers, and the government cannot make you richer by printing more money – or by mandating a raise in the minimum wage.  Jeremiah believes that everything, including your labor, has a “real” price.  The government can raise your “nominal” wage with the stroke of a pen, but it will take concerted effort to raise your real wage.

Let’s say that you have to work all day at the grocery store in order to buy a bag of groceries.  Maybe that’s a six hour shift at nine dollars and you keep $40 after taxes.  You could be paid in pesos, and it wouldn’t make any difference.  Your day’s labor is worth one bag of groceries.

Now, along comes the government and hikes your wage to $15.  Cool, huh?  You will feel richer for about six months, while the dollar depreciates.  You see, everyone else got a wage hike, too.  So, the price of McDonalds went up, and the price of gas went up, and groceries went up.

You still have to work all day to buy a bag of groceries.  Your nominal wage went up, but your real wage is unchanged.

Raising your real wage will take real work.  It takes a growing economy, and a tight labor market.  You may have to join a union, or find a new job, or go back to school.  Government can help, with the right policies, but there is no magic.

If you believe that the government can change the real wage structure by fiat, then you believe in magic.  As Thomas Sowell said, if you can’t handle the truth, you’ll keep voting for liars.

See also:  Socialist Brain Drain

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The Chosen People

SowellA couple of the Senators who questioned Fed Chair Yellen today mentioned her “historic” appointment.  This is simpleminded identity politics.  The Fed has been run by the tribe for thirty years.  You know which tribe we mean – Keynesians!  So, this one is female.  Big deal.  How about putting Thomas Sowell in there?  Now, that would be historic.

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The Praetorian Guard

In the latter days of empire, Rome was occupied by her legions, no different from the provinces.  Here, we posted Barton Hinkle’s observation that America’s police are now militarized, “like a conquering army.”

We have seen how this looks in Turkey and in Iran.  The illiterate baseej don’t mind beating an educated woman for showing too much ankle.  Plus, there is the occasional looting and other perks.

In other cities there’s cops who are actually committing sexual assaults on duty, so I thank God that this is what passes for controversy in Austin  – Police Chief Art Acevedo

We were reminded of the cultural aspect, by this YouTube video of young Amanda Jo Stephen being taken down by the police in Austin.  It looks a lot like that photo from Turkey, doesn’t it?

woman-arrested-on-street-615x345Coarse as it is, Chief Acevedo has a point.  Elsewhere in America, the police rape, rob, and murder with impunity.  We have stopped counting the incidents.  Reason has a good list, and Radley Balko is here.  Jeremiah would prefer not to see parallels between America and these other police states, past or present, falling or fallen.

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The Crimean War

Easter EggUkraine is ethnically different from Russia.  They speak a different language, and they paint eggs for Easter.  Since the revolution, eastern Ukraine is inhabited by Russians.  In Kiev, they want to be part of Europe.  In Sebastopol, they still miss the Soviet Union.

Cowardice, weakness, lack of ideas, and above all the distraction of other events prevented any deeper engagement. And now it may be too late.

The ideal outcome would be a government that can hold the country together, remain independent, and keep both groups happy.  That’s what Angela Merkel  means by territorial integrity.  Yugoslavia, for example, has splintered into seven different countries since the end of the Cold War.

Russia could easily separate the Crimean peninsula from the rest of Ukraine, the same way they separated Abkhazia from Georgia.  They staged a provocation that required Russia to “protect” its ethnic minority.  The quote above is from Slate’s coverage of that well-planned emergency, subtitled Russia invades Georgia while the West watches.

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Fun with Science

The Volokh Conspiracy has moved to the Washington Post.  Here is a fun article from Jim Lindgren about which political groups are most likely to believe in astrology.  Hint: they also do yoga and eat kale.  The post includes links to Lindgren’s published research.

To test the theory that resistance to scientific change is a central feature of conservative thought, I did my own analysis of self-reported conservatism in twenty-one U.S. national probability samples from 1972 through 2002, involving 27,142 subjects

Jim’s paper, “Who Fears Science?” does a brilliant job of testing what we think we know about the nexus of science and politics.  We also enjoyed the Newspeak variable names, like scifaith and naturpax.  Not to be outdone, Jeremiah collects prejudices from both camps, below:

ScienceJeremiah commits the very sin Lindgren warns against, stereotyping the political camps – not to mention glib summaries of the science – but you get the idea.  We struggle to make our opinions fit the facts, and we are too cocky about having science behind us.

Update:  Right after we wrote this, Lindgren did his own post on politically linked ignorance of science.  As before, Jim does a fine job of explaining his inferences from the quiz questions.

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Chandra Levy, Meet Zoe Barnes

chandraReaders below a certain age may have missed the significance of HOC’s unfortunate Miss Barnes meeting Rep. Underwood (D-SC) in Rock Creek Park.  That’s where real life victim Chandra Levy was found, thirteen years ago.

The murder of Chandra Levy remains Washington’s most famous unsolved crime. Many people, including police and prosecutors, suspected that a congressman was responsible.

Jeremiah became restless immediately upon reading the text message, assuming the evil congressman would kill Zoe on the spot.  Alas, that would be too obvious.  Ms. Levy’s murder is still unsolved, but we feel some closure seeing it replayed on TV.

See also:  The Real History Behind House of Cards

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El Niño Grande

waterworld23Continuing our series on economics and meteorology, we find an interesting parallel involving large quantities of inflation and heat energy that have lately gone missing.

Climate skeptics have been enjoying the sixteen-year pause in global warming while, despite this contrary evidence, IPCC scientists are sticking by their models.

Simulations …  suggest that warming should have continued at an average rate of 0.21 °C per decade from 1998 to 2012.

This case of models versus evidence has an exact parallel in monetary policy.  Purists say that $4 trillion in quantitative easing must inevitably result in raging inflation, never mind that CPI is still quiescent.  They even use thermodynamic metaphors, like “pumping” and “hot money.”

Austrian [economists] made some very strong predictions about inflation — and rightly, given their model of how the world works.

For fun, we can add political labels.  Paul Krugman identifies monetary hawks as “the right.”  On climate change, the roles are reversed.  The left believes in IPCC modeling, and the right believe their thermometers.

So, where are the missing quantities?  The excess heat, as everyone knows, has gone into the Pacific Ocean, while the inflation has gone into assets like stocks, T-bills, and Ferraris.

Jeremiah expects both will come roaring back simultaneously, raising the sea level along with the price of milk.

See also:  Partly Bullish, Chance of Recession

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